‘Nationalist agenda’ pushes Mexico up Verisk Maplecroft’s Resource Nationalism Index

Mexico has risen several places on global risk and consultancy firm Verisk Maplecroft’s latest Resource Nationalism Index (RNI), with Latin American nations continuing to seek more control over their mining energy revenues, according to the research.

Venezuela continues to top the list, while Argentina has been placed in the top 20 for the first time after coming in at number 81 out of 198 countries in the third quarter of 2018.

Verisk’s RNI represents the level of risk to business from governments taking greater control of economic activity and revenue generated in extractive industries. The research evaluates state drivers, participation in extraction and expropriation outcomes to provide a perceived risk score.

Mexico’s rise from 101 in the third quarter of 2018 to number three at present is driven by President Andres Manuel Lopez Obrador’s (ALMO) ‘nationalist agenda’, according to the analysis.

“A legislative proposal (now stalled) to nationalise lithium indicates AMLO’s interventionism is all but certain to expand beyond oil and gas in the second half of his term,” the report noted.

In the case of Argentina, Verisk said President Alberto Fernandez’s intervention in multiple sectors is the source of the increased risk. Meanwhile, ‘the once stable mining jurisdictions’ of Peru and Chile are both on the cusp of political changes that will impact the operating environment for the industry.

Brazil and Colombia – both led by centre-right governments – are also seeing an increase in risk for resources investors, as environmental concerns increasingly play a bigger role in policy shifts.